Going Digital : How to take the film out of the movie industry

Mark Cuban is a billionaire who wants to retrofit all of his theaters in the Landmark Cinema chain. He will convert them all to digital projection.

Let Xeni Jardin explain it:

[Cuban] dismisses talk that the industry isn't ready. "People get frightened about all kinds of things in Hollywood," he says. "That's not my system. I don't have a business to protect. I have a business to build."

It's a business filled with promise - and no small amount of uncertainty and financial peril for the key players.

First, the upside: Going digital would be a boon for studios, theater owners, and moviegoers. If studios no longer had to make thousands of copies of each film to deliver to theaters, they could save hundreds of millions of dollars a year.

According to the Motion Picture Association of America, the studios spent more than $631 million in 2003 on film prints for the North American market alone. Taking these reels out of the equation could snip distribution costs by up to 90 percent, says Patrick von Sychowski, marketing director at Unique Digital, which places ads in European cinemas.

When you factor in the cost for foreign releases and overseas distribution, cutting out the prints translates to an eventual savings of as much as $900 million a year.

Likewise, switching to digital exhibition systems would give theater owners unprecedented flexibility. If a blockbuster packed more seats than anticipated, an owner could quickly reallocate screens that weren't selling as well to handle the overflow.

In a film-based world, such changes can be cumbersome, time-consuming, and costly - requiring an additional print from the studio and a reel swap. With digital, they would be nearly instantaneous and come at almost no cost, once the onetime hardware expenses were recovered.

Moviegoers, for their part, would be treated to a future that promises no more out-of-focus projection, out-of-order reels, or scratchy footage on heavily played film.

Even more exciting to Cuban is the broader range of content that digital systems make possible: Beyond movies, theaters could offer live, hi-res broadcasts of sports events, Broadway plays, fashion shows, and multiplayer electronic games.

Well, the future is now, baby! Hats off to Mark Cuban.